Propelled by price increases that surpassed 10% quarterly, directors & officers insurers saw direct premium growth of 35% during 2021, according to AM Best, which reported the sector's premium total reached $14.6 billion.
"Excess capacity has been a primary contributor of the disparity between rates and the pricing of risk exposures, even as the loss ratio crept upward" Christopher Graham, senior industry analyst, industry research and analytics, AM Best, said in a release. "With results worsening because of factors such as social inflation, litigation funding, environmental, social and governance concerns and cyber-related claims, insurers have pushed aggressively for elevated premiums upon renewal, as well as higher self-insured retentions and more-restrictive terms and conditions,
Where the market moves from here will be dependent on if insurers remain vigilant in meeting rate adequacy and offsetting claims costs, which continue to rise, according to the credit rating agency.
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Steve Hallo
Steve Hallo is managing editor of PropertyCasualty360.com. He can be reached at [email protected]
